By Dana J. Patton and F. Douglas Scutchfield, M.D.
From Foresight, Vol. 4, No. 4
published 1997
Access to care, Kentucky health care leaders conclude, will remain at the top of the health care agenda for the foreseeable future. Respondents to a leadership opinion survey conducted by the Kentucky Long-Term Policy Research Center and the University of Kentucky's Center for Health Services Management and Research identified access to care as the most significant health policy issue the state will confront over the coming years. It will be further complicated, many conclude, by impending limitations to health care services for medically needy Kentuckians, who will be affected by welfare reform, Medicaid managed care, reductions in Medicare coverage, and other regulatory changes.
Health care opinion leaders also anticipate that access to care will figure prominently among the issues their own organizations will confront. Only managed care, which is predicated on the notion that access can be broadened by controlling health care costs, figures more prominently in the issues these leaders believe their organizations will reckon with on the immediate horizon.
These opinions emerged from a study conducted jointly by the Kentucky Long-Term Policy Research Center and the University of Kentucky's Center for Health Services Management and Research in an effort to lend a future-oriented perspective to health care decisionmaking in the Commonwealth. For this delphi study, which involves the collection and analysis of opinions from recognized leaders in a field, state health care leaders were identified and surveyed about the future of health and health policy issues in Kentucky. Specifically, 75 senior leaders in health care were asked to identify the health care issues they think will be most important to their organizations and to the state over the next five to seven years.
For the study, 25 state health care leaders were identified from a broad base, including legislators, doctors and nurses, citizen advocates, insurance companies, health agencies (both state and local), hospitals, and educators. These 25 leaders were then asked to name five additional health care leaders. From 19 responses, 75 health care leaders were identified and mailed a short survey which asked them to cite the three most significant health policy issues their organizations would face and the single most important issue the Commonwealth would face over the next five to seven years. A total of 51 responses were received.
When
asked to identify the “single most important health policy issue” the Commonwealth will face, these opinion leaders overwhelmingly cited issues of access to care. Included in their responses were declining coverage for the medically indigent, anticipated increases in costs for health care, limited public resources, and the health consequences of limited access to preventive care. Specifically, 52.9 percent of respondents and more than half of the responses (27 out of 51) cited access to care as the issue that will dominate state concerns in the immediate future. As one respondent suggested, the state will continue to confront the policy dilemma of how to provide “health insurance coverage for the current uninsured while keeping insurance premiums affordable to the majority of Kentucky's insured population.”Figure 1: Top Issues Confronting Kentucky, as Identified by State Health Care Leaders
In related responses, several health policy leaders referred to the need for state-level policies or a strategic state health care plan. One respondent observed:
Kentucky is not a wealthy state and it is imperative to have responsible health planning in order to assure optimum resource allocation and access to the appropriate level of health care for the 3.5 million residents [3.9 million in 1996, per the State Data Center] of the Commonwealth. For example, Kentucky has 18 open-heart surgery programs with only six meeting minimum criteria outlined in the State Health Plan. That circumstance is contrary to our goal of providing quality, cost-effective health care.
Another health policy leader echoed similar sentiments:
The single most important health policy issue the Commonwealth will face is the
commitment to have a comprehensive state health policy . . . As the state focuses on
balancing its health budget, it is either unwilling, unable or both to address the
question of who will pay for the indigent patient. This is not a problem that will go
away.
Another respondent saw the issue which policymakers confront as a moral dilemma that has been complicated by an expanding for-profit context.
Kentucky policymakers will . . . continue to grapple with the issue of whether access to medical services is a right, and to decide how society will choose to ration access to care and distribute its costs. The emergence of for-profit hospitals and insurance carriers in the last 10-15 years has dramatically changed these dynamics, as has the strong growth in demand for medical services—largely driven by improvements in medical science and increases in the share of the population over age 50.
An insurance industry representative observed that the health policy challenge to a state is particularly difficult, given federal mandates that preclude autonomy, the lack of funds and staff to manage health care outside of Medicaid, and the inability of any state to regulate beyond its borders.
The single greatest challenge for Kentucky is to understand that health care is interstate commerce that is applied on a very personal basis by highly trained individual professionals. Remove the social programs and give providers the opportunity to serve our patients.
In contrast, some respondents suggested that the current delivery model needed to be replaced with a single-payer system. Others observed that the central challenge is that of extending health insurance coverage to those who are presently uninsured while containing the cost of insurance premiums. One respondent suggested that affordable basic health services for all citizens could best be met by expanding both the role and the level of public support for local health departments. Several respondents noted that supporting multiple and duplicative medical, dental, and other health service provider schools is a drain on public resources and further evidence of the absence of an overriding health policy or plan designed to contain costs and allocate resources wisely.
After access, responses dropped sharply to 10 percent or just 5 respondents who cited the aging of the population as the single most important health policy issue that will confront the state. These respondents saw diminishing Medicare coverage, rising needs for and costs of long-term care, and an inadequate number of long-term care beds as important future issues. Another 8 percent or 4 respondents cited managed care as the leading health policy issue the Commonwealth must wrangle with in coming years. In a response clearly related to managed care, one leader suggested that returning power to providers will make its way onto the public policy agenda.
Other issues these leaders believe the Commonwealth will face include the declining ranks of qualified providers, escalating Medicaid costs and insurance premiums for the healthy and for small employers, and the need to integrate our public and private health care delivery systems.
Significantly
, leaders in the field of health care see the organizations they represent grappling with essentially the same issues they believe the Commonwealth of Kentucky must reckon with over the next five to seven years. Given the opportunity to cite three issues before their organizations, these opinion leaders see a future complicated by a range of cost and access issues. The impact of managed care was cited most often (56 percent of respondents and 19 percent of responses) as an issue organizations will confront. It was followed by access to care and health insurance reform (38 percent of respondents and 13 percent of responses for each), both of which reflected high levels of concern about care of the indigent and uninsured. Other access-related issues cited included health care financing, health care for children, primary care, and welfare reform.Figure 2: Top Issues Confronting Health Organizations, as Identified by State Health Care Leaders
Because these opinion leaders anticipate an organizational future that will demand attention to a family of cost, access and quality-of-care issues, the pressure for attention to the larger health care “forest,” rather than the “trees” of isolated issues such as high-risk individuals, could mount in the coming years. As organizations are forced to reckon with declining public support for health care, as well as a range of public and private cost-reduction strategies and federal and state mandates, institutional pressure for structural change is likely to increase. As one respondent observed, “Even though many traditionalists may not want to do so, (we) must take a hard look at the potential that a single-payer, truly managed care system might have.”
Many of these opinion leaders anticipate rising levels of institutional stress due to “changes in reimbursement and payment mechanisms which are eroding profitability and threatening the viability of health care organizations.” One respondent noted, “Managed care does not pay the cost of providing service. In almost every case, home health agencies lose money on services.”
While there were overlaps in concern about managed care and managed Medicaid, the issue of managed Medicaid was particularly salient among these opinion leaders, as the implementation process is beginning in two of the state’s service regions. Many expressed concerns about future funding for the program at the state and federal level, as well as the impact of welfare reform. Additionally, several respondents raised concerns about how Kentucky will organize to provide managed Medicaid in rural areas.
Others cited concerns about ethical issues surrounding managed care as it relates to the provision of quality care at reduced costs. One respondent observed that an “appropriate level of managed care (is needed) to meet conflicting demands of society for contained costs while maintaining flexibility of choice and high quality.” Another respondent countered, “The excessive profits made by many, in the name of cost-effective care, must be addressed.”
In the near future, 38 percent of these respondents see access to care as a significant issue their organizations will face. One respondent expressed the concern and frustration apparently felt by many by simply asking, “Will the poor get health care?” Other respondents noted that many “working poor” and “near poor” are uninsured and questioned if access would be expanded to meet their health care needs. As with Medicaid managed care, an issue many respondents believe will affect their organization is welfare reform and its impact on the health care coverage of the poor. One respondent stated the most significant health policy issue in the future will be “providing/securing health care coverage for adults who leave welfare and take low-wage, no-benefit jobs.”
An additional related concern was raised concerning core public health functions. One respondent asked, “How will (public health departments) functioning in the Medicaid/managed care arena affect our ability to provide clinical services to those with no insurance, no money, no medical card, and nowhere else to go?” Several respondents noted that particularly vulnerable populations in Kentucky—the indigent, the elderly, and children—need better access to health care. A respondent who identified himself as affiliated with a rural health center told us that his main concern is the lack of financial resources to pay for primary health care services for increasing numbers of medically indigent patients. He stated that more than 35 percent of all their new patient encounters are with indigent patients who have no health care coverage of any kind.
Most of the 38 percent of respondents who cited health insurance reform as one of their three most significant health policy issues related it to cost-shifting and high-risk groups. One respondent explored a series of questions around cost shifting, “With resources stretched to the limit, policy issues center around who and how will health care costs be paid? Who will be subsidized? Should persons of low-to-average risk subsidize unhealthy or high-risk populations? Should the young, healthy person pay more to subsidize the unhealthy, older citizen? Is the private insurance system going to support the needs of the future?” A suggestion was made that Kentucky may need to go through an open discussion of equality of payment versus cost shifting to those whose behavior (smoking, alcohol abuse, not using seat belts) affects costs.
Most of the concerns stated about the aging of the population centered around long-term care for the elderly; 22 percent of respondents cited the aging of the population as the most significant health policy issue their organization will face in the coming years. With an increasing elderly population, most noted, comes a rising demand for long-term care, for which funding may not be available. One respondent suggests that we should look for lower cost alternatives to long-term care such as home health and assisted living.
One respondent noted that the number of Kentuckians over age 75 is expanding as available federal health care dollars are contracting (at least relatively). Nearly 80 percent of the cost of nursing homes is paid by Medicaid, and nursing homes consume 25 percent of the Medicaid dollar. Of particular concern is the impact of managed Medicaid in this area. This respondent goes on to say, “Kentucky might provide incentives for citizens to secure health insurance to underwrite the cost of long-term care, or perhaps change the system of chronic care. If, however, no action is taken, demands on the Medicaid program will continue to escalate over the next 5 to 7 years and beyond until they overwhelm all other budget priorities in the coming decades.” Another respondent notes that as Baby Boomers age, simply meeting their personal care needs will become a challenge. Finding competent staff at current wages, this respondent fears, will become increasingly difficult. Along these same lines, another respondent answered that a potential issue for the future is “de-skilling” the health care workforce, particularly in the areas of acute and long-term care institutions.
Respondents identified two issues of concern that are likely to be addressed on the immediate horizon. Managed care, which now comprises around 20 percent of total health insurance written, is expected to grow rapidly. This will likely be the result of three forces: the growth of managed Medicaid in Kentucky; changes in Medicare reimbursement rates to managed care that are expected to spur rapid growth in Medicare managed care; and the conversion of the small amount of commercial indemnity care to managed care plans.
Similarly, some of the most immediate problems of health insurance reform are likely to be addressed by the next General Assembly. It remains to be seen whether this effort will focus on immediate problems or take a more global, long-term approach to health insurance reform. Over the short run, the effort to accomplish health care reform could focus on such issues as high-risk pools, health insurers that have left the Kentucky market, the purchasing alliance, or the association exemption from modified community rating. However, these senior health leaders have identified deeper issues that will require more long-term and more holistic solutions.
Access to care, these leaders assert, is not only an increasing problem for the indigent, the uninsured, and the elderly, it is one that will affect the financial viability of organizations throughout the state. And it is likely to get worse. Today, 14 percent of Kentucky's population is without health insurance, and large pockets of uninsured remain in Appalachian Kentucky. However, the impact of welfare reform on Medicaid eligibility and the uninsured status of many emerging workers and their children could be significant. State plans to deploy savings from managed Medicaid to coverage of the uninsured and new federal allocations for uninsured children could help close a widening gap, but an economic downturn could undermine even the best-laid plans.
While some of these issues will be addressed in the short run, it is unlikely that a definitive solution will soon be reached. Indeed, these issues have plagued the U.S. health care system for years. However, the concerns of these health care leaders illustrate the importance of a systemic, long-term approach to health policy reform, rather than short-term fixes. The recognition that these issues will vex the state and its health care institutions for years to come underscores the need for more thorough and complete solutions to problems with our current health care system.
A full report on these and other findings from this study will be released in the summer of 1998.
Dana J. Patton, a former intern with the Kentucky Long-Term Policy Research Center, is a graduate student in political science and a research assistant with the Center for Health Services Management and Research at the University of Kentucky. F. Douglas Scutchfield is director of the Center and Peter P. Bosomworth Professor of Health Services Research and Policy.